[2017] KEHC 2933 (KLR)
The court found that the issues in dispute between the parties could not be resolved at the interlocutory stage and required full hearing and determination. To preserve the subject matter and prevent prejudice to the petitioner, the court exercised its discretion to grant conservatory orders restraining the...
Source-derived case information.
- Citation
- [2017] KEHC 2933 (KLR)
- Parties
- Applicant: Busia Teachers Training College; Respondent: Kenya Revenue Authority; Respondent: Commissioner of Domestic Taxes
- Court
- High Court
- Court Station
- High Court at Busia
- Jurisdiction
- Kenya
- Case Number
- Petition 4 of 2017
- Procedural Posture
- Constitutional Petition / Ruling on Interlocutory Application for Conservatory Orders
- Outcome
- conservatory orders granted conditionally
- Judges
- KW Kiarie
- Legal Topics
- Conservatory Orders, Agency Notices, Tax Disputes, Bank Account Freeze
- Source Language
- en
Source-derived case record
Summary, issues, holding and outcome
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Parties
Busia Teachers Training College
Applicant
Kenya Revenue Authority
Respondent
Commissioner of Domestic Taxes
Respondent
Procedural Posture
Constitutional Petition / Ruling on Interlocutory Application for Conservatory Orders
Legal Issues
- 1 Whether the petitioner is entitled to conservatory orders restraining the respondents from enforcing agency notices and levying distress on its property pending determination of the petition.
- 2 Whether the petitioner should be required to furnish an irrevocable banker’s guarantee as a condition for the grant of conservatory orders.
Ratio Decidendi
The court found that the issues in dispute between the parties could not be resolved at the interlocutory stage and required full hearing and determination. To preserve the subject matter and prevent prejudice to the petitioner, the court exercised its discretion to grant conservatory orders restraining the respondents from levying distress or enforcing agency notices against the petitioner's property and bank accounts. However, to balance the interests of both parties and secure the respondents' position, the court made the grant of conservatory orders conditional upon the petitioner furnishing an irrevocable banker’s guarantee for the disputed tax sum within fourteen days, failing which...
Court Disposition
conservatory orders granted conditionally
Orders
- A conservatory order is issued restraining the respondents from levying distress against the petitioner's property and staying the operation of the agency notices issued to the named banks pending hearing and determination of the petition.
- The petitioner shall furnish an irrevocable banker’s guarantee from a reputable bank for the sum of Kshs. 8,568,455.00 within fourteen days, failing which the conservatory order shall stand discharged.
Full Case Text
Judgment text and source record
22 paragraphs
REPUBLIC OF KENYA
IN THE HIGH COURT OF KENYA AT BUSIA
PETITION NO. 4 OF 2017
BUSIA TEACHERS TRAINING COLLEGE......................................PETITIONER
AND
THE KENYA REVENUE AUTHORITY.....................................1ST RESPONDENT
THE COMMISSIONER OF DOMESTIC TAXES...................2ND RESPONDENT
RULING
The petitioner has moved this court by Notice of Motion dated 31st May 2017 under Article 23 (3) (c) of the Constitution of Kenya for conservatory orders in the following terms:
1. That pending the hearing of this application inter parties, a conservatory order be issued staying and or suspending the 2nd respondent’s decision to attach the petitioner’s bank account Nos. 012437672200 at National Bank of Kenya Busia Branch, 112277919 at Kenya commercial Bank Busia Branch and 08811005417 at Barclays Bank Busia Branch and the petitioner be allowed to access the said Bank accounts forthwith.
2. That the costs be in the main petition.
The application was opposed and the respondent prayed for the petitioner to be ordered to furnish an irrevocable banker’s guarantee from a reputable bank for the disputed sum.
Article 213 (3) (c) of the Constitution of Kenya provides as follows:
In any proceedings brought under Article 22, a court may grant appropriate relief, including––
(c) a conservatory order;
I have noted that there are issues which both parties have failed to come to a consensus. The matter will require to be determined by calling of evidence. This is an apt case for issuing conservatory orders as follows:
That pending the hearing and determination of the petition, a conservatory order be and is hereby issued restraining the 1st and the 2nd respondents by themselves or their authorised agents from levying distress against the property of the petitioner including their bank accounts and staying the operation of the Agency Notices issued to the National Bank of Kenya, the Kenya commercial Bank and the Barclays Bank claiming or enforcing all or any taxes due arising from the tax audit in issue herein.
The order is granted on the condition that the petitioner shall furnish an irrevocable banker’s guarantee from a reputable bank for the sum of Kshs. 8,568455. 00 within fourteen (14) days from the date hereof and in default the order currently in force shall stand discharged.
The costs of this application shall abide by the judgment.
DELIVEREDandSIGNEDatBUSIA this 18thdayof October, 2017
KIARIE WAWERU KIARIE
JUDGE